Irish cider maker's deadline to make a rival bid for pubs group expires on
Tuesday, clearing the way for Greene King to succeed in its £773m takeover

Magners maker C&C Group is expected to walk away from making a £780m knock-out bid for Spirit Pub Company this week, leaving the path clear for Greene King to bolster its pub empire.

The Irish drinks group has until 5pm on Tuesday to make a bid or walk away after more than three months of looming in the background.

However, City sources have said that the cider maker would have needed to offer a mouthwatering all-cash offer to trump Greene King’s £773m cash and stock takeover and this is unlikely.

Spirit’s board has already accepted and recommended a bid from Rooney Anand, the ambitious chief executive of Greene King, which will create a group with 1,110 pubs and restaurants in London and the South East.

C&C stunned the market in October when it revealed plans to gatecrash Greene King’s deal. It is understood that C&C initially approached Spirit with an offer of around 110p per share, just three days after Greene King made a 109.5p offer. The rival bid prompted Greene King to sweeten its offer to 115p a share.

Analysts have questioned C&C’s interest in pubs and said the interest in Spirit was a departure from strategy. However, Stephen Glancey, C&C’s chief executive has significant pub experience from his time at Scottish & Newcastle and has said that owning a well-run pub estate would act as a shop window for its drinks brands, which is has struggled to sell in the UK pubs market.

However, analysts and investors have made it clear that they do not want C&C to overpay for the experiment into pubs, which would inevitably happen in a bidding war with Greene King.

Unlike Greene King, C&C would not have immediate synergies or be able to take out millions of costs because it does not already have a pub estate. C&C shares have continued to trade lower by around 10pc since it made the aproach.

On top of the rival bid threat Greene King’s takeover of Spirit has also been complicated by the radical changes by British politicians to abolish the 400-year-old beer tie system.

Despite Greene King initially saying in Parliamentary evidence that an end to the beer tie would have a “huge negative impact” on the business, the pubs group has remained committed to the takeover.

Around 41pc of the combined company’s estate will be tenanted pubs, with the higher proportion of managed pubs which are unaffected by the beer tie.

Unlike normal UK bidding scenarios, which have a much tighter one month timeline to make a formal bid or walk away, C&C has been able to keep its cards close to its chest for much longer as it only has to go public with its intention ten days before a court meeting sanctions Greene King’s takeover on 13 January